CASE

Blast it! said David Wilson, president of The Terrain Company. Weve just lost the bid on the Koopers job by $2,000. It seems were either too high to get the job or too low to make any money on half the jobs we bid.

The Terrain Company manufactures products to customers specifications. Jobs require varying amounts of work in three departments, Fabricating, Machining, and Assembly. Direct labor cost drives the cost of the products produced.

After several lost clients, the president hires a consulting firm to determine a better system to cost jobs and price bids. The consulting firm discusses two approaches, the plantwide approach and the departmental approach, that can be used to determine the amount of manufacturing overhead that should be applied to jobs. The Terrain Company has provided the consulting firm with estimates that were made at the beginning of the year and the traceable costs of the Koopers job.

Business Brief Rubric

Total 100 points

Criteria	Unacceptable	Acceptable	Proficient	Student Score and Comments
Applies the 5-step critical thinking decision making tool (appendix).	Vaguely applies the 5-step critical thinking decision making tool. (0-7 points)	Applies the 5-step critical thinking decision making tool and, for the most part, fulfills assignment requirements. (8 points)	Applies the 5-step critical thinking decision making tool and demonstrates solid ability to accomplish the assignment. (9-10 points)
Accurately completes the worksheet problem.	Does not accurately complete the problem (0-10 points)	For the most, accurately completes the problem and fulfills assignment requirements. (11-16 points)	Accurately completes the problem and demonstrates solid ability to accomplish the assignment. (17-20 points)
Develops an opening paragraph that introduces the case and accurately identifies the issue(s) of the case.	Vaguely develops an opening paragraph that introduces the case and identifies the issue or does not have an opening paragraph or does not identify the issue. (0-10 points)	Develops an opening paragraph that introduces the case and/or identifies the issue and, for the most part, fulfills assignment requirements. (11-13 points)	Develops an opening paragraph that introduces the case and identifies the issue and demonstrates solid ability to accomplish the assignment. (14-15 points)
Analytically discusses the problem results as identified in the problem requirements.	Vaguely analyzes and discusses the identified problem requirements. (0-8 points)	For the most part analyzes and discusses the identified problem requirements. (9-12 points)	Analyzes and discusses the identified problem requirements and demonstrates solid ability to accomplish the assignment. (13-15 points)
Integrates established accounting principles into the discussion.	Rarely integrates established accounting principles into the discussion. (0-2 points)	For the most part, does a good job of integrating established accounting principles into the discussion. (3-4 points)	Consistently does a good job of discussing and integrating established accounting principles into the discussion. (5 points)
Synthesizes relevant information and materials to provide evidence of critical thought.	Synthesizes information at a minimal level. (0-7 points)	For the most part, effectively synthesizes information, which supports main ideas. (8 points)	Consistently and effectively synthesizes information, which provides strong support to main ideas. (9-10 points)
Develops ideas with clarity and logic.	Demonstrates little clarity and logic. Readers have difficulty following the line of reasoning. (0-7 points)	Develops ideas with clarity and logic. Readers can generally follow the line of reasoning. (8 points)	Develops ideas with clarity and logic. Ideas flow smoothly from one to another and are clearly linked to each other. (9-10 points)

Uses supporting documentation that has been properly references and cited.	Inadequate or minimal use of supporting documentation or not properly referenced or cited. (0-2 points)	For the most part, uses supporting documentation that is properly referenced and cited. (3-4 points)	Consistently uses supporting documentation that is properly referenced and cited. (5 points)
Considered holistically, demonstrates the ability to write at the graduate level.	Considered holistically, the student demonstrates an inadequate ability to write at the graduate level. (0-7 points)	Considered holistically, the student demonstrates an acceptable ability to write at the graduate level. (8 points)	Considered holistically, the student demonstrates a proficient ability to write at the graduate level. (9-10 points)
Total Points

1. Read the Business Brief 3 Case Facts and Review the Grading Rubric for the assignment.

Case Background: You work for the consulting firm hired by the president of the company. Your objective is to provide an analysis of the presidents concerns (see step 4b) and make a recommendation with a brief.

2. Complete the excel worksheet attached to the assignment.

• Plantwide Approach
  1. Compute the plantwide predetermined overhead rate for the current year.
  2. Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job.
  3. Assuming a customary industry markup on bids of 150% of total manufacturing cost (direct materials, direct labor, and manufacturing overhead), determine the companys bid price on the Koopers job using the plantwide predetermined overhead rate.
• Departmental Approach
  1. Compute the predetermined overhead rate for each department for the current year.
  2. Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job.
  3. Assuming a customary industry markup on bids of 150% of total manufacturing cost (direct materials, direct labor, and manufacturing overhead), determine the companys bid price on the Koopers job using the departmental predetermined overhead rate.

3. Download the 5 Step Critical-Thinking Decision-Making Matrix.

• Complete the questions concerning Step 1: Identify the problem(s) and uncertainties based on the assigned problem.
• Complete Step 2: Obtaining Information on the matrix.
• Complete Step 3: Make predictions about the future on the matrix.
• Complete Step 4: Make decisions by choosing among the alternatives on the matrix.

4. Write a one-page analysis according to the Business Brief Guidelines. Complete sentences must be used (bullets not acceptable). Your analysis must be written using a concise writing style. Your brief should incorporate all of the following instructions:

1. An opening paragraph briefly introducing the case situation.

Note: The first half of the opening paragraph is to provide a synopsis of the case facts (relevant facts only - know your audience!). The second half of the opening paragraph is state the problem(s) (From Step 1 of the matrix).

2. Analysis header - The analytical section should be based on your personal assessment of the financial results from the worksheet. Develop your analysis using percentages and/or relevant dollar totals/balances. This section has the highest point value and should address the following:
   • Explain the difference between the manufacturing overhead that would have been applied to the Koopers job using the plantwide approach and the departmental approach.
   • Explain how the different approaches affect the bid price on jobs.

Note: Avoid the inclusion of calculations and/or explaining computations; instead refer to Appendix A. Avoid duplicating information within this section. The information for this section of brief should be derived from Steps 2 and 3 of the matrix.

3. Conclusion header - This section should include your opinion based on your analysis of the case information. The conclusion is typically 1-2 sentences. Provide only key relevant information and logical discussion in support of your opinion.

4. APA citation(s) and reference(s).

5. Attach the appendices to your business brief:
   1. Appendix A containing the excel worksheet.
   2. Appendix B containing the completed 5-Step Critical-Thinking Decision-Making Matrix.

Appendix C containing the grading r